Eurozone bond yields, particularly yields on French government debt are likely to dip on Monday as markets are relieved at Macron’s win.
A widely watched spread between French and German government, a gauge for French political risks, is likely to tighten.
“We had thought the markets were a bit complacent going into the elections and we had gone short on Italian debt as a result.
“We could see OAT bond yields move 10 bps tighter and German bund-swaps spreads also narrow 5 bps.
“What we have learned form the last couple of years is that the polls are good but not completely reliable.
“On the economy, I think it is interesting as Macron cannot run again so his legacy will be set in the next five years.
In the short term, the main logical beneficiary of this election could be the euro, which was still flirting last Friday with two-year lows against the dollar.